Given some of my key subjects, I can’t help but be interested in the “occupy” movement that, at the moment, has a few hundred protesters [UPDATE: Now a lot more; I was there on Tuesday] more or less living in Zuccotti Park near the New York Stock Exchange in lower Manhattan, and is apparently starting to engage in similar protests in other cities. You can’t find out much about this action via “mainstream media,” and even much of the left media, such as it is, has been critical in some cases, and outright dismissive in others, regarding the movement’s evident formlessness and absence of specific goals.

But I write about the deep, founding roots of rowdy, American populist protest and insurrection, often visionary and even utopian, yet informed and practical too, specifically over money, credit, and the purpose and nature of public and private finance. And despite my pop-narrative books on the subject, and despite my articles here, and in such place as Newdeal20.org (articles picked up by AlterNet, Huffington, Salon, Naked Capitalism, and others), key indicators of my relative impact (like royalty statements!) give me a sneaking suspicion that most people still don’t connect the American founding period with a rugged drive on the part of ordinary people for equal access to the tools of economic development and against the hegemony of the high-finance, inside-government elites who signed the Declaration and framed the Constitution and made us a nation.

Sometimes people even ascribe democratic ideas to the famous upscale American Revolutionaries, who to a man actually hated democracy and popular finance. Paine, the exception, was ultimately rebuked and scorned by all of the others. [UPDATE: Anyway, Paine wasn’t one of them; I threw him in defensively because consensus-history types like to “include him in” on the basis of “Common Sense,” while including his social/economic radicalism out.]

The difficulty in dealing with our founding battle for democratic economics arises in part because the movement was not against England but against the very American banking and trading elites who dominated the resistance to England. That complicates our founding myth, possibly unpleasantly. Also, it was a generally losing battle. With ratification of the Constitution, Hamiltonian finance triumphed, and people looking to Jefferson and Madison for finance and economic alternatives to Hamilton are barking up the wrong tree, since what those men knew, or even really cared, about finance could be written on a dime. (Anyway, in pushing for creating a nation, Madison supported Hamiltonian finance down the line. Their differences came later.) When Occupy Wall Street protesters say “It’s We the People!” they’re actually referring to a preamble, intending no hint of economic democracy, to a document that was framed specifically to push down democratic finance and concentrate American wealth for national purposes. Not very edifying, but there it is.

The Tea Party, meanwhile, has taken up founding economic issues from a right-wing point of view, associating itself with the upper-middle-class Boston patriots (often mistaken for populist democrats) who led a movement against overrreaching British trade acts in the 1760’s and were important to the impulse toward American independence. I’ve written fairly extensively about where and how I think the Tea Party goes wrong on the history of the founding period. But at least they’re framing their objections to current policy, and framing the historical roots of their ideas, not mainly in cultural but in economic terms.

Like it or not, though, it is Occupy Wall Street that has the most in common, ideologically, not with those Boston merchants and their supporters but with the less well-known, less comfortably acknowledged people who, throughout the founding period, cogently proposed and vigorously agitated for an entirely different approach to finance and monetary policy than that carried forward by the famous founders. Continue reading →

Charles Rappleye, in an op-ed published by the L.A. Times on August 12 (I just caught up with it via the Bangor Daily News), might seem at first glance to be saying pretty much what I’d been saying in my New Deal 2.0 post of August 1 (also on AlterNet and Salon) regarding the framers of the Constitiution and the issue of public debt — a subject especially relevant to specious Bachmann/Norquist/Tea Party efforts to construct balanced budgets and zero debt as constitutionally essential.

Liberals will tend to like Rappleye’s piece for suggesting that enlightenment minds of the kind liberals admire had a logical, well-informed rationale for founding the nation on a public debt supported by taxes. The piece thus flies in the face of certain right-wing preconceptions, and it may be taken as giving modern liberalism at least as strong a claim as the Tea Party’s on the founding generation’s values regarding financial issues so hotly debated today.

But beyond noting that contrary to the populist right’s view, the Constitution was in fact created largely in order to fund a national debt via federal taxation (an assertion outrageous enough for Constitution-romanticizers both left and right), Rappleye and I take directly opposing views of the significance of that founding debt, and especially of the domestic goals of the confederation Congress’s financier, Robert Morris, a mentor of Alexander Hamilton, in yoking a large public debt to national aims, indeed to the aim of having a nation at all.

Employing a tone of knowledgable, disinterested, slightly amused, “above the fray” superiority, which I find all too typical of commentary that we might borrow a term from Leslie Fieldler and call “liberaloid,” Rappleye must lionize Robert Morris (Rappeleye is the author of a Morris biography that does so on a larger scale), playing up certain features of Morris’s goals and ideas, downplaying others, and declining to give the economic context that, from a modern liberal point of view anyway, would substantially darken the Morris-Hamilton founding-finance story. Continue reading →

At “Line of Fire,” the blog for Broadside Books, the HarperCollins line of conservative titles edited by Adam Bellow, Michael Patrtick Leahy (editor of the “Voices of the Tea Party” series, co-founder of Top Conservatives on Twitter and the Nationwide Tea Party Coalition) and I are engaging in a civil yet incisive discussion of my contention that the Tea Party has distorted founding history to fit current political aims. Below are some samples.

The Tea Party movement, for example, has laid its claim on the founding period, and to a great extent that claim is indeed an economic and financial one. Casting the modern welfare state as a form of tyranny, in large part because of what they see as its excessive taxation, Tea Partiers invoke the famous American resistance to Parliament’s efforts to raise a revenue in the colonies without the consent traditionally given by representation. . . . The Tea Party thus edits out an alternative view of government that prevailed among the ordinary 18th-century Americans who were all-important to achieving independence. . . . The internal struggle for American equality was as important to the founding as the high-Whig resistance to England, but the Tea Party can’t deal with the populist leaders and militia rank-and-file who wrote the socially radical 1776 Pennsylvania Constitution, or the Shaysites of Massachusetts who marched on the state armory, or the so-called whiskey rebels who inspired federal occupation of western Pennsylvania.

Mr. Hogeland condescendingly assumes that tea party activists are unfamiliar with these three historical incidents. To the contrary, we are more familiar with their relevance to our modern circumstances than is Mr. Hogeland himself.

As an historian, Mr. Hogeland should familiarize himself with the three core values of the Tea Party movement, which we’ve loudly proclaimed in every venue possible for the past two years: (1) Constitutionally limited government (2) Free markets and (3) Fiscal Responsibility.

As he well knows, both the 1776 Pennsylvania Constitution and the Shays Rebellion of Massachusetts took place before the ratification of the Constitution. As for the “Whiskey Rebels” of western Pennsylvania, their complaint against the early Federal government was that it passed a law that unfairly taxed small whiskey producers at much higher rates than large whiskey producers in urban areas. It was a violation of their individual liberties and the principles of free markets for the government to pick the “winners” (large urban manufacturers) and “losers” (small rural manufacturers).

The Tea Party’s core values, as you lay them out, are overwhelmingly familiar, not only to me but at this point probably to almost everybody else, and as they stand, they’re banal and tendentious, meant to imply that anyone opposing or opposed by the Tea Party must, by definition, favor 1) unconstitutionally unlimited government, 2) strangled markets, and 3) fiscal irresponsibility. Since nobody would openly espouse such a position, it’s useless to argue about it. Any real argument would have to be about what those deliberately unarguable phrases might mean, what they include and exclude, how they should or should not be applied, etc. . . .

To the contrary, our claim that the Constitution, as ratified and amended, is a secular covenant by which we are all bound is the strongest, most democratically rooted claim on history that emerges from the American founding period. . . . Mr. Hogeland appears to regard the Constitution as something other than a binding secular covenant, and in this I would submit he makes an error of historic misinterpretation. . . . Mr. Hogeland seems to be implying that the process by which the Constitution and Bill of Rights were ratified somehow excluded the ordinary citizens who participated in these events. To the contrary, they were heavily involved. Indeed, many of the authors of the 1776 Pennsylvania Constitution participated as elected delegates to the state convention that ratified the Federal Constitution by a 2 to 1 margin in 1789. Influenced by this debate, no doubt, the state of Pennsylvania threw out the 1776 version of its constitution the very next year, so unsuccessful in actual operation had been this document upon which Mr. Hogeland relies for one-third of his argument. Similarly, the participants in Shays’ Rebellion of western Massachusetts voted for delegates to that state’s 1788 ratification convention as well as members of the Massachusetts State Legislature who later deliberated the merits of the Bill of Rights.

I am curious where Jefferson (and for that matter Madison, Adams, Washington, and the other main framers) spoke hesitantly about democracy, the people, and the state legislatures. Conservatives would be surprised and it would undermine their ‘rely only on the framers’ approach.

Secondly, it would be interesting to see what the regulators and radical democrats philosophy on private property. If the elite were concerned about the violation of natural rights against private property when it came to paper emissions, what was the radicals’ response? Did they have a philosophy when the constitution was being debated?
Posted by Brian | May 11th, 2011 at 5:31 pm

Wow. In the comment thread on Naked Capitalism, regarding my final New Deal 2.0“Founding Finance” post, the commenter Peripheral Visionary offers the best-informed, most gracefully and concisely written summary I’ve ever seen of the classic interpretation of the American founding from which my work is precisely intended to dissent. This is so commonly believed, so perfectly put, and so utterly the reverse of what I’ve come to think that I quote it at length:

An interesting assessment, and I generally agree that the Founders’ views were quite complex and varied, and not easily summarized.

It needs to be pointed out, however, that social democracy ultimately had its roots, not in the American revolutionary state, but in the French revolutionary state. That explains its particular emphasis on class, and its focus on the division between capital and labor; both were key features of Western Europe, but not as prevalent features of the American state, which was dominated by independent farmers and craftsmen (hence, with capital in many if not most instances being owned by labor, and therefore with only vaguely-defined class distinctions, the South being the major exception).

In the founding American state, the route to relief of poverty was not through the state (and it is difficult to believe such a thing would even have been considered), but rather through the frontier. The frontier served as an enabler of the otherwise disempowered, who by way of the homestead acts could secure property, independence, and the means of supporting themselves (all at the expense of Native Americans, of course–but then, redistribution programs are zero-sum and therefore always come at a cost to someone else). That “outlet” consistently relieved pressure on the impoverished areas of the East and the South, which would go a long way toward explaining why socialism gained little traction in the 19th Century. Only in the 20th Century, with the last of the frontier exhausted, could socialist tendencies, in the form of social progressivism, gain traction. When Steinbeck’s Joad family goes west in the California of the 1930′s, they find an oppressive class state; had they gone west just fifty years earlier, they would have found open land and opportunity.

That’s the reading that I think a realistic look at finance in the founding period turns upside down.

For example: No, social democracy does not have ultimate roots in the French revolutionary state. For better and for worse, the French revolutionary state had roots in the Pennsylvania revolutionary state. Continue reading →

To the young democratic resisters in Egypt, some of whom I’ve heard saying in street interviews that they admire the American Revolution, I want to say something complicating. (No, I don’t literally think they’re taking time out of changing their country and the world to follow my blog — but hey, you never know!) This: It’s a somewhat bleak fact that the only successful American founding-era revolution for democracy occurred in Pennsylvania in 1776 — and that wasn’t the Continental Congress’s declaring independence from England.

This may be annoying. There may be times for believing in the big, uncomplicated American narratives, and this may be one of them. But Egyptians want democracy, and our famous Declaration was not a declaration for democracy, and since that’s what my books are about, I’m seeing events in Egypt a certain way.

(For what it’s worth, that is. Back when I was shouting and waving my fist in the steet, I didn’t live in a military dictatorship. And I sure didn’t go back the next day to sweep up. Respect.)

Anyway, the real 1776 democratic revolution I’m talking about is at once an inspiring and a cautionary one for worldwide democratic revolutions today.

I should note that everything I know about politics in Egypt I’ve learned from the papers and the radio in the past month. Like so many others, I’ve followed the uprising there with bated breath because of its nonviolence and the strange — possibly unique? — relationship of the military to both the protestors and the regime. With everyone else, I await next steps. Will a government that has been a military one for generations actually enable real elections and subordinate the military to representative civilian authority? Maybe. But if so, the ironies will be many. BBC and others have reported that it is the younger officer corps (not young, younger) that groks the civilian-control thing — and that’s because unlike their Soviet-tutored elders, they’ve grown up under the influence of the U.S. alliance and studied in our war colleges. That would mean our long alliance with a military dictatorship may have had a liberalizing influence on its military. Hm.

There are of course a host of parallels and precedents in U.S. revolutionary history that might provide both inspiration and warning for modern democratic movements. George Washington, a general, did famously hand over the reins of power after his presidency. Of course, he’d been elected in the first place (though not with any real competition). And the army he’d once led had been disbanded some years earlier. Which didn’t stop his administration from flirting, putting it politely, with militarism. And nobody has ever been more sick of being president than George Washington. . . Still, when it comes to subordinating the military to the civilian authority, we may hope that Egyptian generals would consider emulating both the myth and the reality of our American Cincinnattus’s republican integrity.

That was a republican integrity, though, not a democratic one. Washington was no believer in democracy. Nor were any of the other famous founders. And Egyptians want democracy. So while the generals should follow Washington’s example, young people seeking inspiration for democracy in the American revolutionary period need to look to figures who do not show up in certified histories of the American Revolution.